Why sell permanent Insurance?

[Franz Kafka]

Yikes! It scares me that you say that! I ALWAYS offer term to my clients who are under 55, and show them why WL or UL is not the answer, its too expensive!

I hate to say it, but buying term and investing the difference is the best concept... you just have to make sure your clients are doing it.

THere are some rare cases that WL makes sense, but for the most part it does not.

Do you realize how irresponsible you sound when you say WL/UL is not the answer because it's "too expensive"?
Yes, BTID is THE best concept but are you helping your clients "invest that difference" or are you just selling them term and wish them "good luck with your investments"?
99% of the people DON'T KNOW HOW to invest the difference. 99% of them DON'T KNOW what their risk tolerances are. 99% of them become very aggressive when the market/economy is doing great and very conservative when the market/economy is doing bad. It doesn't matter what they invest in; stocks, funds, real estate, commodities whatever. 99% of them do the exact opposite of what they should be doing. The "market" knows this and that's why it's designed to take money from the poor and give to the rich. Letting average client handle their own investment is like giving my 5 year old a rifle to go hunting. He may accidentally kill a squirrel but most likely he will end up hurting himself.
That's why I believe an average person needs "forced savings" and their money should be locked away until they retire (with room for extreme financial hardship). Even with high surrender charges people would still rather keep their Mercedes than their policies. This is what happens in real world to which BTID concept is not accustomed. JMO.

 

[Third Joker]

What difference is there to invest? Why is it that this perceived "difference" supposed to come from insurance? I mean, maybe I should drive a smaller car and invest the difference, take a shorter vacation and invest the difference, etc.

 

[bobson]

What difference is there to invest? Why is it that this perceived "difference" s supposed to come from insurance? I mean, maybe I should drive a smaller car and invest the difference, take a shorter vacation and invest the difference, etc.

Have your teeth pulled, skip the dentist and invest the difference.

Or maybe don't go to Missoula, miss watching the Griz from the football Mecca and miss the tailgate party, invest the difference.

 

[bobson]

Do you realize how irresponsible you sound when you say WL/UL is not the answer because it's "too expensive"?
Yes, BTID is THE best concept but are you helping your clients "invest that difference" or are you just selling them term and wish them "good luck with your investments"?
99% of the people DON'T KNOW HOW to invest the difference. 99% of them DON'T KNOW what their risk tolerances are. .

BTID is the best concept? Really, for whom? For the insurance company? The client? You the agent? It's ridiculous for any of us to think we know where someone will be ten, twenty, thirty or more years down the road.

99% of the people shouldn't be 'investing' money anyway. The stock market is for the ultra-wealthy with money to lose. We need to begin saving in this country not investing in public companies. How many hundreds of thousands of retirees have had their retirement wiped out because the company they worked for tanked along with their 401k? Ernon, Worldcom, etc, etc. The list keeps getting longer. But we're sure the stock market is the place to be? Who are we kidding?

 

[Third Joker]

....Yes, BTID is THE best concept....

BTID isn't a concept, it is a replacement strategy.

 

[bluemarlin08]

Perhaps one should say buy term and save the difference?
Do you think that if someone puts premiums into a "forced savings vehicle" that they are less tempted to use the funds prior to retirement?

 

[bobson]

Perhaps one should say buy term and save the difference?
Do you think that if someone puts premiums into a "forced savings vehicle" that they are less tempted to use the funds prior to retirement?

I don't think enough people are putting money into any kind of savings at all. We actually spend more money than we make each month. I'm no financial guru, I don't have any kind of TV show or book but it seems like eventually that will become a problem. Why even discuss investing???? Let's discuss saving money first.

And let's realistically look at the problem of dying. We will all do it. I'd much rather have a big chunk of tax free life insurance benefit given to my wife when I die (no matter when I die) than having her forced to liquidate some assets to keep enough money coming in.

 

[myinsurebiz]

#1 - I don't think enough people are putting money into any kind of savings at all. We actually spend more money than we make each month. I'm no financial guru, I don't have any kind of TV show or book but it seems like eventually that will become a problem. Why even discuss investing???? Let's discuss saving money first.

#2 - And let's realistically look at the problem of dying. We will all do it. I'd much rather have a big chunk of tax free life insurance benefit given to my wife when I die (no matter when I die) than having her forced to liquidate some assets to keep enough money coming in.

1) Well said . . .

2) So - how do you compare Term with ROP against Whole Life? Someone say - 45 and in decent health - would a combo of say $20k whole life and $200k 30 year term with ROP - or just one over the other - or none?

A "big chunk" would be expensive for a "big face" whole life wouldn't it?

Tom

 

[GreenSky]

1) Well said . . .

2) So - how do you compare Term with ROP against Whole Life? Someone say - 45 and in decent health - would a combo of say $20k whole life and $200k 30 year term with ROP - or just one over the other - or none?

A "big chunk" would be expensive for a "big face" whole life wouldn't it?

Tom

Why not just buy the ROP with a premium (preferred) of about $920 a year and not buy the whole life? 30 years later they have $27,000 of CASH plus whatever they saved in not buying the permanent plan.

I fail to see the advantage of having a small whole life policy to pay for final expenses when you have the cash in your hand.

The $27K of cash will buy a paid up policy probably for $40-50K (maybe more).

Rick

 

[myinsurebiz]

#1 - Why not just buy the ROP with a premium (preferred) of about $920 a year and not buy the whole life? 30 years later they have $27,000 of CASH plus whatever they saved in not buying the permanent plan.

#2 - I fail to see the advantage of having a small whole life policy to pay for final expenses when you have the cash in your hand.

1) Mathematically it does make sense - but, blue collar types seem to like the whole life. At least that is what I've experienced.

2) I don't either if they can qualify for the Term, provided they aren't 65 years old already. I had a conversation with an agent of mine in Atlanta and he wants to be able to sell Term with ROP personally and within his Team to people 45 and under - it does kinda make sense . . .

Just don't know of any with decent commissions that are non med and TeleSales capable . . .

Tom